This video is brilliant, thought provoking, and informative. The whiteboard illustrations alone are worth every minute.

In one section the presenter states the main purpose of schooling is to turn children from present minded hedonists into future oriented planners and organizers. That’s part of the truth, but there is a social sorting aspect of schooling that goes far beyond simply reprogramming our perception of time. It’s a way of creating winners and losers before the adult game of life even begins. Also, one can be a future oriented person without succeeding in school. True, schools force you to plan and organize for the future – next week’s assignment, final tests, prom, the pep fest, the football game, taking the right electives to secure a place in college, etc, but the institution strictly controls what you must plan to do. Many future oriented people have different plans than the paths offered in school…

For many people, it isn’t a question of CAN you live on 50% of your income. The real question is… Do you WANT to live on 50% of your income? Are you willing to make the hard trade-offs? What might those trade-offs be?

Travel

The type of food you eat

The clothes you wear

The car you drive

Walking away from a mortgage and renting a room in a crime ridden neighborhood

Dropping out of school

Most Americans would be surprised how little you NEED to stay alive. Most Americans use the word NEED to describe the things they think they NEED to live the life they WANT to live. Most things people think they NEED are not NEEDS at all, but DESIRES.

On Get Rich Slowly, a 20 year old just asked Am I Being Foolish Saving So Much?. He saves 50% of his income, lives at home, and attends college. If he quit saving so much, he believes he could move out, start a business, or buy a new car. Why should he sacrifice those possibilities to save money he can’t touch until he’s 65? Good point, isn’t it? J.D. gives him a decent answer, and he gets close, but not quite there. Maybe J.D. didn’t want to get esoteric or political, but this is the answer…

Everything you choose to do has a cost. It’s called opportunity cost. Every minute you spend could have been spent doing something else. The opportunity cost of writing this blog post is nearly infinite. I could have spent this time reading to my kids, golfing, biking, or even robbing a bank. The same principle applies to money. Your money represents your time and your(or someone’s) past labor. When you choose to do something with your money you are indirectly spending “time”. When someone steals your money or property they are murdering a portion of your life. No one tells you that in school, do they? When you save your money, you are saving a part of your life for use later. If your life is shorter than expected, saving is a bad deal. That’s why you need to decide for yourself what you want to do. No one should decide for you. Don’t allow them to. It’s your life. You choose. It’s called freedom. But you’ll have to live with the cost of your choices. (Well, maybe not, you can get someone else to pay your costs if the right people get elected, but in any case, someone is going to incur the cost of your decisions.)

Who are we to tell people what they should and shouldn’t do with their time? Who are we to tell a kid he can’t drop out and be a musician, or an artist, or an entrepreneur? We don’t know the cost of staying IN school. We think we know the odds, but I’m not sure we do. Who are we to say you shouldn’t get married at 18 and have kids? How do we know that will lead to unhappiness? Maybe waiting will lead to unhappiness. I’m delighted I’ve been with Christine since we were 19. It’s one of the best decisions I’ve ever made. There are things about our relationship that would be nearly impossible for a couple to build if they met at 35.

We can only make an educated guess about risks and possibilities based on what has happened in the past to other people. But that doesn’t mean you will get the same results as others. There are oddles of people who took all the safe bets and are miserable.

So what should our 20 year old writer do? Whatever he WANTS,butwhatever choice he makes will have costs. Weigh them, decide, and accept responsibility for the decision. Responsibility is the price of freedom.

Edit 5-15-2010: I know this post was all over the place. But this is my point – Imagine if Steve Jobs had decided to stay in school and save his money instead of building a computer in his garage. What would have been the opportunity cost of his decision?

Don’t you love stories about children who can face life threatening hardship with bravery, optimism, and cheerfulness? When their young minds comprehend not only the physical challenges facing them, but also the financial challenges, and seek out and find solutions?

Let me tell you about Malkolm.

I first heard about Malklom a couple of days ago when my wife (Christine) was reading the eBay power sellers board.

Christine said, “There’s this woman who sells DVDs on the eBay power selling board. She has a 9 year old son with a heart problem. His heart muscle is thickening and he needs surgery or he could die. His mom has insurance and it pays 80% but they are still going to have a difficult time paying the other 20%. Malkolm was worried about the cost of his surgery. He had written some award winning stories at school, so he asked his mom if he could sell one of them on eBay to help pay for the surgery. His mom was so overcome with emotion she had to fight back the tears. With encouragement from other eBay sellers, they decided to give it a go. Now he’s selling his story on eBay for $10. They sold over 100 in the first 12 hours.”

“Yeah it’s legit. Lot’s of people know her on the power sellers board. She’s been there a long time and other sellers are helping” she said.

So we bought one. And I must say… It’s fantastic writing for a 9 year old. Here’s an excerpt:

I keep on striding down the road, and a nice little house steps into my view. There is a closed window, and a small candle glows inside. I hear a voice: “Goodnight, Katie.” A small voice replies: “Goodnight, mommy.”

I think to myself, “I think I’ll take a peek.” I jump toward the window, trying to get their attention. As soon as I smack against the window, I black out.

Have you ever heard, “You have to have money to make money?” I suppose it’s true. But you don’t have to have much. We started christinesbooks.net in 2003 with $500.00, haven’t incurred a single dollar of debt since, and grew it organically. How did we do it? Persistence, patience, and a lot of frugality.

In America today, patience isn’t a virtue. Getting things done now is, regardless of the risk. Unfortunately, that type of thinking has led us into the economic mess we face today.

Since the last post on our move from a home based business into a showroom/warehouse operation, we’ve made some changes.

Some things we needed to get off the ground.

Shelving in the warehouse

Equip and furnish the office

Get the internet operation running profitably

Build out the showroom.

Host weekend, discount liquidation sales

Warehouse shelving – $1000

Buy pallet racking – After checking some suppliers on Craigslist, we discovered the pallet racking would cost $1000s, would be too bulky, and wouldn’t be appropriate for our products (books, DVDs, CDs, and games).

Build shelves ourselves – I started down this path, but quickly discovered I didn’t have the time and the quality wasn’t high enough.

Contract someone to build custom shelves – After careful planning, we estimated this would cost us between $10-20K, and it didn’t make sense for a company our size

What we did:

I built some shelves from kits – about $300.

It took time, but we found a couple dozen commercial grade shelf units for $700 at a local private school. They decided to downsize their library.

Here’s what the warehouse looks like now:

Furnishing and equipping the offices -$570

Desks – Free from a out of business karate school

Office Chairs – Free – see above

Shelves – Free – see above

Computers – Free – We moved one from home, and I built the other from recycled parts.

Most nights after putting my 7 year old to bed, we have lengthy discussions about life and reality. While he spends most of his day repeating silly nonsense from Sponge Bob, at night, when the lights go out, he changes. He’s a night person, his brain shifts into high gear in the darkness and silence… just like both his parents.

Some of his questions:

Where did everything come from?

Why is there something instead of nothing?

Why did the Big Bang happen?

How long ago did the Big Bang happen?

If we went back in a time machine and watched the Big Bang, what would it look like?

If everything is expanding, what is it expanding into?

Is there more than one universe?

Is time travel possible?

What is reality?

Where was I before I was born?

What was before the Big Bang?

For some of these questions, science does have an answer, and for some, it does not.

We once thought the Earth was flat and the Sun revolved around the Earth. Not that long ago many scientists adhered to the Steady State Theory that the universe had no beginning or end and was in a state of constant creation. And when I was a child science told us we were entering an ice age, while today they tell us the Earth is facing a catastrophic warming.

Sometimes the most important questions are the ones that offend the current culture.

In truth, we know little about reality, and the questions we do answer are likely to produce even more puzzling questions, but that’s no reason to quit asking questions and looking for evidence, and the closer we look the weirder reality appears to be.

I tell him, “Keep an open mind. The answers you read in books or are taught in school are what we think we know right now. But that doesn’t mean there isn’t a better explanation. Never quit asking questions and seeking answers.”

If your kids are like mine, and don’t care for team sports, MMA is an excellent alternative.

My son does MMA training 3 nights a week at the American School of Martial Arts in Savage MN. When he chose to take Karate, we visited several different schools, and he decided on MMA. He liked the school, the instructor, and the structure. He can quit any time he wishes. But he knows, if he quits, it’s final, and I am never taking him back (just a little lesson about the power of decision).

7 Things My 7 Year Old Learned from MMA

Goal Setting – It started with learning a Kenpo technique called the Snapping Twain. He was determined to do it correctly. Then he began focusing on earning stripes for his belt, and later decided to earn his first belt. The goals he sets in MMA are not easy to achieve. They take months of focus and consistent practice. Now, without my prompting he sets financial goals and educational goals for himself, and I credit the things he’s learned in MMA training

Persistence – He’s been at this 18 months and still hasn’t earned his second belt. His first belt took 9 months. Some days he practices free grappling, which is Jiu Jitsu (the art of softness – no hitting or punching). He lost dozens of these matches, but improved with each loss. Previously, he avoided things that weren’t easy for him, now he accepts the challenge even if the odds are are against him. Why? He’s discovered that if he keeps trying, he will improve. Sometimes he sees improvement in an hour, other times it takes months. But with consistent effort, improvement happens. This is the same son that invented the word “Shandshowbo” when he was 4. It means keep trying even when it’s hard.

Confidence – There is no substitute for self-confidence. If you don’t believe in your ability to overcome obstacles, if fear of failure stops you, you will never reach your goals.

“Confidence comes not from always being right but from not fearing to be wrong.”

Confidence comes from deep inside, and it is reflected in your posture, the way you shake hands, if you look someone in the eye when they speak to you. The kids at ASMA are taught to stand up straight, look each other in the eye, shake hands, and speak clearly and confidently. In my experience, very few kids have the basic social skills that come with confidence. Confidence comes from knowing you have the mental and physical strength to deal with adversity and challenge. MMA training fosters that confidence.

Nutrition – Look at a group of today’s youth and you’ll see that few kids understand the foundation of good nutrition. MMA training stresses the importance of eating healthy natural foods and avoiding sugar, HFCS, and processed foods. Each day, the instructor requires my son to name 5 fruits and vegetables he has eaten that day. If he can’t, he does 25 push ups. This method has been so effective, in 18 months, my son has never had to do those push ups. By 6 years old, he developed an obsession with eating healthy foods. He nags us to feed him healthy food. Today, he frequently says things like, “I’m not eating candy for the next 60 days.” He does this with no prompting from me or the instructors. He does it because he wants to be healthy and test himself. That is radical self-discipline for a 7 year old.

Physical Fitness – Each training session starts with a 10-15 minute run, followed by a routine of stretches and calisthenics. After about a year, he could do over 100 squats and 50 push-ups in near perfect form. Many mornings he gets up early and works out for 20 minutes on his own. One morning I awoke at 6 AM to sounds coming from the living room. There was my son doing squats. Physical fitness isn’t a goal, it’s a habit, and MMA training ingrains the habit young.

Frustration Tolerance – Trying something difficult for the first time is frustrating, especially if you’re around other people who make it look easy. The same is the case for MMA training. Many times my son grapples with bigger more experienced kids, they end up on top of him, and it’s frustrating and difficult to get out from underneath them. I’ve seen the frustration on his face after a difficult situation. A situation when he fails repeatedly. But in time, I’ve seen him turn that frustration from fear and anger, into determination, and finally achievement.

Focused Attention – Your strength and ability at any task, is directly related to your ability to focus your attention on your goal and the task at hand. The power of focused attention is the most powerful thing you control. The importance of focus can’t be stressed enough. I don’t care what you’re doing, writing, painting, drawing, speaking, running, or swinging a golf club, focus is essential.

As many of you know, children, especially boys, struggle with focus and attention, some more than others. Some kids just “space off” a little, others are diagnosed with ADD/ADHD and are prescribed powerful psychotropic drugs. Putting a child on mind altering drugs is a huge decision, one that shouldn’t be taken lightly. Alternative treatments are possible, and Martial Arts training can and has worked as an alternative therapy for ADD/ADHD. (Please do not stop any medication without consulting with your child’s physician.)

Many kids show typical ADD/ADHD symptoms because they aren’t getting enough exercise. Parents and schools tend to discipline a hyperactive child by making them sit still for long periods of time (timeout). For most hyper kids, this only produces more hyperactivity. Instead, have them run laps or do squats or push ups. Exercise helps kids focus.

Sportsmanship – Have you seen a kid throw a fit when they don’t win? Have you seen him mock his opponent when he does win? Have you seen a child look for a weaker opponent simply because he didn’t want to lose? Have you seen him refuse to try when he realized he would probably lose? These are all issues of sportsmanship. Sportsmanship is a basic social skill we all should master. We all compete at some level, and good sportsmanship reflects strong character.

Trying challenging things and failing builds sportsmanship, and MMA training challenges kids. No one is a superstar on day one. Everything is earned and all bullying is shunned.

Why MMA?

My son loves it and he doesn’t like team sports. Maybe that will change, but until it does, MMA provides all the physical and mental benefits of team sports.

We hear a constant refrain about the dangers facing our children today – Obesity, ADD/ADHD, Stranger Abduction, and Apathy. We also hear about the entitlementality – kids growing up believing they’re entitled to things that must be earned – things that cannot be bestowed from the outside – things that must be grown over time in your soul. To build a strong future we need to help young men and women build a strong character. Unfortunately, for the most part, character isn’t being learned or taught in our schools.

Building strong character begins at home, but a child needs input for many sources, sources that may not be available in every home. As parents we are limited to our own knowledge and perspectives, and for me and Christine, that isn’t enough. Our kids need role models, who can share knowledge and experience, we as parents do not have.

Perhaps you’re feeling stuck, or even trapped, in some area of your life. Maybe a job or a hobby which you once loved has turned into a chore – or a relationship has gone sour.

The problem is, you can’t quite imagine giving it up. You’re still clinging to the early hopes you had, or desperately trying to regain your past enthusiasm. Maybe you’ve been in your job, or engaged on a particular project, for so long that there really doesn’t seem to be an alternative.

There is: and to create it, you need to start by thinking yourself free.

What Would Happen If You Lost It?

Let’s say you’re not enjoying your job. (You wouldn’t be alone: statistics show that more than half of us dislike our jobs.) You might have been enthusiastic about your career field once, but now, you simply go through the motions.

If quitting seems unthinkable, try imagining how you’d feel if you were laid off, or if you had to leave due to circumstances beyond your control. Once the initial shock had passed, would you feel a sense of relief? Would you feel as though a burden had been lifted?

I’ve never had a problem with quitting jobs I disliked (it’s how I became a full-time freelancer, a year ago) – but a few months back, I was ploughing on with running a blog when my enthusiasm for it had died. It wasn’t until someone emailed me, asking how much it would cost to buy the blog, that I began to find the mental space to let it go.

(I didn’t sell it – but I did decide to only do minimal maintenance on the site. The funny thing is, nearly all the advertising revenue I’ve had from it has been since I stopped actively blogging there…)

Of course, quitting your job is a lot scarier than simply giving up on a blog or on another project that you’ve lost interest in. When I was working on leaving my day job, I asked myself…

What’s the Worst Case Scenario?

If you abandon the project, job or relationship that’s holding you trapped, what’s the worst that could happen? Think this through: would you be homeless? Starving? Broke? Or would even the worst possible consequences be ones that you could quite easily recover from?

When you clarify the worst case scenario in your mind, you’ll notice some interesting things:
• The consequences aren’t so dire as that vague cloud of fear in your mind suggested
• You can already see plenty of ways to recover if the worst does happen
• The worst case scenario seems pretty unlikely anyway
Don’t stay with the doom and gloom, though (even if it doesn’t seem so bad after all). Think about…

What’s the Good Stuff That Will Happen?

If you left your job, there’d be some negative consequences (like a lack of income), but there’d also be a ton of positive ones. Write down the ones that mean the most to you. Maybe:
• Having time to spend with your kids
• Not having to work with a boss or colleagues who don’t share your values
• Finally getting to pursue your dreams
• Being able to sleep better at night

Leaving a situation that has you feeling trapped will always result in a massive, empowering sense of freedom. Allowing yourself to visualise all these positive consequences can help you create the desire to actually get to them.

Getting There

Once you’ve liberated yourself mentally from the chains of your dull job, draining relationship or flogging-a-dead-horse project, it’s time to take action. Spend a few minutes really visualizing your success: hold on to that sense of freedom. Then write down some immediate steps you can take to get yourself closer. You don’t need to know every single step on the path – you just need to have a map for where you’re going next.

In some cases, the steps might be pretty short. Perhaps you want to wrap up your project to make sure you still get something out of it: this could mean anything from selling off your materials to finding a suitable “end point”. If you want to drop out of college, perhaps you’ll decide to stick out the semester in order to get the credits for classes you’ve already started on.

If you want to leave your job, there are likely to be a few steps you want to take to avoid that worst case scenario. For many people, the first task is to establish an emergency fund (or to add to an existing one). Keeping your goal in mind can help you stay motivated to cut your spending and put money aside each week or month.

Keep thinking yourself free. Keep imagining your life without the situation that’s dragging you down. However tough life seems, or however trapped you feel – you’re not. There’s always a way out, and the first step to creating it is to imagine it.

Bio: Ali Hale writes about getting more from life on her blog, Aliventures: if you enjoyed this post, you’ll probably enjoy Life: Choose Your Own Adventure. Ali is also a freelance blogger for a number of other sites, and is taking a postgraduate degree in creative writing.

In this post, I am going to detail my experiences finding the right place for our business at the right price.

We found it, and last week, we signed the lease. We are remodeling and moving in over the next six weeks.

We’ve been planning to move christinesbooks.net from our home to a commercial bricks and mortar operation for years. The most perplexing question we had was:

How do we find the best possible location at a price that will allow us to grow?

The problems we faced:

High Taxes

Several years ago, we almost opened a traditional retail book store, and we wrote this post on negotiating rent. We never signed the lease. The rent was right, but the taxes were too high. In Minnesota, retail tax rates are out of control. In our case the taxes were 4x the rent. High tax rates keep small family owned business like ours out of the prime locations. The problem is, no one in government seems to care. When I recently mentioned the problem to a government official, she replied, “If you can’t afford the taxes, you can’t afford to be in business.”

How we solved this problem:

We decided against renting traditional retail space, in high rent areas (for now). Even in a recession, when the landlords reduce rent to attract tenants, the government doesn’t budge on taxes. The only viable solution for us was to rent a location zoned showroom/industrial where the taxes are 1/3rd of traditional retail.

Over Leveraged Commercial Property Owners

During the real estate boom, investors bought up properties under the false assumption that real estate couldn’t drop in value. Many made these investments using unsecured debt. During our search we found several owners sitting on vacant properties, but unwilling to negotiate a reasonable price.

In one instance, the owner had purchased an entire corner of a busy intersection. It included four buildings which all sat vacant. When we investigated, we learned that the owner had purchased the property at the peak of the boom planning to flip it to a national retailer. When the economy went sour, so did his plan. Christine and I and others tried to make an offer that would generate income for both us and the owner, but were flatly refused. Being over leveraged gave the owner no room to negotiate when tough times hit. I wish him the best, but the properties are still sitting vacant today.

How we solved this problem:

We had to be patient and keep looking. We sought veteran landlords who are likely to own the property outright, who have been through economic downturns and understand the current conditions, who have seen successful startups rise from the depths of a recession, and who understand the power of building long term business relationships.

Cities Are Bulldozing Low Rent Areas

In recent years, affordable commercial property became harder to find. Cities like to pick off older low-rent properties with eminent domain, bulldoze it, and replace it with new high rent/high tax property. It is another case of shortsighted greed. To grow, our economy needs low tax/low rent commercial property to serve as incubators for bootstrapping entrepreneurs.

How we solved this problem:

Persistence. After a while, we didn’t bother looking at the new developments, and focused our search on older areas. And the recession helped. While in recent years we’ve watched old retail and industrial parks knocked down and replaced, right now, there is almost zero commercial development.

Last Minute Lease Changes

For whatever reason, be it mistakes, disorganization, or outright chicanery, the lease terms you verbally agreed upon are different the day you sit down at the table, ready to sign. My father-in-law, who has negotiated dozens of commercial leases over his lifetime warned me about this. It is standard procedure – expect it. These last minute changes are NEVER in your favor.

How we solved this problem:

Don’t sign the lease. Walk away and keep looking. Think about it. Imagine, at closing you said, “I looked the lease over, and I made a mistake, it’s more money than I can afford, and much of the square footage isn’t useful, so I adjusted the rates down 20 percent, and I need you to cover the utilities, so I wrote up a new lease for you to sign today.”

Leasing Agents Didn’t Help

I talked to at least a dozen of them. Some of them were great… others… not so much. But none of them represented us. They each offered a few properties out of hundreds of possibilities. Some gave us bad information, but mostly they gave us incomplete information.

How we solved this problem:

We had to do the search ourselves. We found property on Craigslist and other websites. The property we eventually rented was a property I drive by every day but I didn’t bother calling. I thought it was out of my price range based on information leasing agents had given me. One day, I decided to call, and the leasing agents were wrong, we could get 3000+ sq ft, at a price we could afford. Never quit searching and never accept the word of experts without finding out for yourself.

Keeping Costs Down

In business you need to make more money than you spend. If you can’t do that, you don’t have a viable business. And if you need a bricks and mortar location for your business, rent/mortgages can wipe you out.

But keep in mind it has to be a win-win for you and the property owner and finding the right location is going to take time. We have been passively looking for years, and actively searching for over nine months. When I first started calling leasing agents, I didn’t think this was possible. For a comparable space, agents were asking for 2-4x the rate we eventually negotiated.

It isn’t trendy, or hip, or pretty, or posh. But it’s functional and affordable

And we’re cleaning it up

We are going to remodel, knock down some walls, put in a new floor, and paint.

Are you like me? When you decide to do a thing, you want to act immediately. You strive for constant progress toward your goal, then you run into obstacles… things that are out of your control… like other people who have other plans… but you need them to reach your goal. Then you try to force progress by pushing and prodding and pulling, which only seems to cause others to push back harder. The harder you push, the slower the progress and the higher your frustration. Sometimes you want to quit. Other times you blame others and start to think they are incompetent or lazy. Maybe you eventually give up. You believe you did everything right. If only the other people had “stepped up” everything would have worked. You believe you are a victim of bad breaks, laziness, and difficult people.

The above is called self-will run riot and it is a sure recipe for failure.

But you’ve had the opposite experience too, haven’t you? You’ve had moments in business, or golf, or parenting, or marriage, when everything is perfect, the zen moment. It’s almost like the universe is running everything perfectly and you are just observing it in all its perfection. In these moments, you are experiencing something very close to the truth about reality.

What I’m describing here are two polar extremes. Most of us live somewhere in between.

On one side we have the misguided idea that we can CREATE BY FORCE, but clearly we can see in our own lives, that attempting to create our future by force results in the exact opposite, destruction and failure.

Why do we believe this nonsense about force?
Answer: We live in a culture where we are taught from our earliest days that problems are solved by the application of force. Popular culture action heroes and athletes delude us into thinking we can create a better world via physical strength, will power, and force.

But it is a lie. Force is only justified when someone else has initiated force against us, and even then it isn’t creative. It can only attempt to end the destruction so the natural state of creation can begin anew.

In truth, creation is a process you set in motion, but you can’t control. It’s like a magnificent story that unfolds before your eyes. You focus your thoughts and your actions on your goal and you seek acceptance voluntarily. Creation is the act of allowing. Acceptance and allowing require love and patience. They require humbling yourself to the immense creative power of the universe. It requires “getting over yourself” while simultaneously knowing “the only thing you control is yourself.” All the rest of creation happens on it’s own.